As the heir to a secular tradition familiar only with agriculture as a valid form of economic activity, the town of Zumarraga was destined to usher in the 20th century still with a basically rural economy (agricultural and stockbreeding), although the effects of the building of two railway lines during the 19th century and one in the 20th century were to stimulate an increase in the importance of the industrial sector and, increasingly, there was an expansion of the service sector.
At the end of the 19th century, in 1885, the growth of the manufacture of wickerwork and the processing of reeds began with the founding of a factory by Justo Artiz. Others sprouted subsequently like those owned by the Buscas, the Legorburus, the Jakas and the Garíns. Small basketwork factories proliferated and produced mainly baskets for carrying earth and these were made of wickerwork and chestnut bark. It was so important that Piedad street became known popularly as the “the basket makers’ hill”. The activity continued to grow right up until the 1930s.
It was after the Spanish Civil War that raged between 1936 and 1939 that Zumarraga threw in its lot with the boom in the industrial sector, because the recently established “Esteban Orbegozo” factory devoted to the iron and steel industry meant that from the 1950s onwards a large proportion of the population of what was until then a small town went to work in the factory. They were joined by huge waves of workers who had come from other areas of the Spanish State, and this caused the population of the town to soar.
Together with this important factory other industries were to be set up or enlarged (including “Badiola Hermanos”, “Rojo y Zaldua”, and others), and they were to shape an essentially industrial population.
The service sector for its part was also to grow from the 1950s onwards with the massive immigration, so that Zumarraga could be described as having a balanced economy with respect to its sources of production and also as occupying an important position in the sector.